A stepped-up use of a federal low-income housing tax credit program may spur the construction of needed affordable housing.
So says the New York-based Corporation for Supportive Housing, which in a report is saying that the country is in current need of more than 1.1 million units of such housing.
That housing, the group maintains, also decreases a “high utilization of emergency services and public systems,” while “improving longterm health and well being for vulnerable individuals and families.”
Those living in such housing units are typically people with incomes defined as being at or below 30 percent of area median income.
The Corporation for Supportive Housing points in particular to the Low-Income Housing Tax Credit program, which was launched in 1986 and is designed to finance both the construction and rehabilitation of new and existing housing units.
The incentives in the program are geared especially for both investors and private developers taking on low-income housing projects.
As applied, the program provides those investors and developers with a reduction in their federal tax liability in exchange for taking on affordable rental housing projects.
All tax credits earned under the program can only be awarded only after those investors and developers provide detailed plans for the projects they are taking on.
Those plans are typically submitted to a state’s housing authority, which annually receives a certain amount of federal tax credits for the program, typically in the tens of millions of dollars.
In an interview with the magazine Apartment Finance Today, Robert Friant, Corporation for Supportive Housing spokesperson, asserted that in order for the incentives program to realize its full potential, “states need to reserve designated amounts of tax credit allocations specifically to create quality supportive housing.”
By Garry Boulard
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